For many, tax preparation ranks high on the list of most-dreaded tasks. If you’re in charge of a new business, the anxiety level can be even higher. But being prepared helps ease the stress of filing a business return, even for those who are just starting out. These tips will help you submit your company’s taxes—even if it’s the very first time—with confidence.
Determine the Cost of Goods Sold
If your business involves inventory, accounting software makes it easy to track the cost of goods sold. Some software even lets you upload these expenses directly into your online return. If you haven’t been keeping track digitally of what you paid for items in your store, gather digital or paper receipts. Going forward, try to organize your receipts regularly; it can make the job of filing much easier and less daunting
Gather Business Expenses to Be Deducted
From office space rental costs to the interest on your business loan, you can deduct many expenses from your taxes. If you haven’t been recording these, you should be able to find the amounts you paid in your email or in your account information.
Hire a Tax Preparer
Tax preparation services make easy work of filing your return. Tax professionals understand the complex rules involved with business returns, and they keep up with the latest tax law changes. Tax experts are less likely to make errors, and they make it their business to know the latest credits and deductions available to you.
Paying someone to file your business tax return also reduces your liability to a certain degree. Preparers make the next tax season easier by keeping your information on file. Accountants or accounting firms can even become financial partners of sorts by offering additional services.
Use DIY methods
Although you may be surprised to find that you can afford to hire a tax preparer, you can file your own relatively simple business return. Download forms from irs.gov. Many tax preparation companies have software available online or to download. H&R Block and TurboTax are a couple of the better-known names, but you have many options. Costs vary, and many companies provide state tax preparation in addition to letting you file your federal return.
Once you’ve tackled your first business tax return, you’ll know what to expect. Whether you opt to do it yourself or hire a company offering tax preparation services, you’ll be glad to know that this essential obligation isn’t as intimidating or difficult as it seems. Start preparing early for your next return by keeping receipts and other financial information organized and easily accessible.